Futures File: Ukraine turmoil raises questions

Oats market continues to rise

After the rapid overthrow of Ukraine’s pro-Russian President Viktor Yanukovych last weekend, tensions have been rising as Ukraine struggles to carve out new political leadership. As a former Soviet Republic, Ukraine had been closely tied with Russia but is considering closer economic alignment with the European Union. This has resulted in internal and international conflict as different groups vie for dominance.

For commodities traders, Ukraine is important because it is known as the “breadbasket of Europe” and is one of the world’s largest corn and wheat exporters. In the short term, conflict in Ukraine could diminish farmer’s ability to grow and transport grains, creating short supplies of corn and wheat.

Furthermore, if the conflict involving Russia, Ukraine and the West should escalate, other commodities markets could be drawn into the turmoil. Russia is one of the world’s largest producers of both crude oil and natural gas and has used its control of these vital energy sources as a diplomatic weapon in the past.

Despite these looming threats, neither wheat nor crude oil made major moves this week; wheat had a moderate 15-cent decline to $5.97 per bushel, while crude had a minor 30-cent rally to $102.50 per barrel.

OATS STUCK IN A JAM — The oats market continued exploding this week, reaching an all-time high of $5.33 per bushel on Wednesday. Prices have been climbing as a result of a shortage of the grain in the U.S. Although Canadian grain farmers broke records last year, they haven’t been able to transport their oats to the United States, which consumes 95 percent of Canadian oats exports.

Longer-term, it appears that oat prices may subside as Canadian oats flow to the U.S.; the futures market is predicting sharply lower prices for the July contract, which is trading at a 20 percent discount, near $4.00 per bushel on Friday.

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You liberals and your community organizer makes me sick to my stomach. Quick some liberal blame Bush or Reagan. This is about leverage and who has it. The leverage? OIL! GAS! PIPELINES! You libs don't want it and should park you cars, ride bikes, heat and light with wind and solar or stop talking out of both sides of your mouths for a change.

Escalate? What, the libs don't report scary news now? The RED ARMY took their identifying flags and patches off and are moving west. Just like the guy with a funny mustache did with Czechoslovakia. Just claim the territory that some of the people living on it who are speaking your Motherlands language. In this case Russian instead of German.

"Furthermore, if the conflict involving Russia, Ukraine and the West should escalate, other commodities markets could be drawn into the turmoil. Russia is one of the world’s largest producers of both crude oil and natural gas and has used its control of these vital energy sources as a diplomatic weapon in the past."

Oh. lets not build any pipelines that might help the USA, the Canadians, and the Koch brothers. It's bad for us (Obamas BBFF's like Buffet's RR and Steyer's pipeline).

One more thing Libs! I KNOW the Ukrainian men who don't speak Russian are happy with any firearms that they personally have it they have any. Only a Lib needs to ask why! Ukraine has some of the most stunningly beautiful women in the world and if things "escalate" the RED ARMY isn't wearing any flags or patches.

OK Libs, call me some names, make a snide remark, or critique my grammar or spelling, because that is what you do.